Viewpoint

Why Social Media Should Welcome Location-Based Services

September 27, 2009

Twitter knows where you are. Or at least it will soon, when it introduces a feature that lets your followers know where you are when you send a tweet. The announcement that Twitter will soon give users the option to disclose their physical whereabouts kindled debate over the role of location-based services (LBS) in social media and elicited criticism that the tools are an invasion of privacy.

I've been trying out a wide range of LBS tools to see for myself whether they're useful or something to be feared. I've used Brightkite; Plazes, which was recently acquired by Nokia (NOK); Germany-based Aka Aki, which I like to use in Europe, as well as a series of lesser-known services.

My conclusion after a year of testing is that far from being a threat, sites offering LBS represent vast, unrealized potential to radically transform the way we communicate and stay connected. ABI Research predicts that LBS will generate revenue of more than $14 billion in 2014, from about $2.6 billion this year.

Besides helping us track our location patterns or the nearest Starbucks (SBUX), these apps collect valuable data about our daily routines and the routines of those closest to us. They track personal tastes in food, fashion, and music so we can receive alerts and location-based notifications. Individual users can use LBS to share relevant information and places with friends. The device maintains a record of our daily routines, and it's constantly looking for people we know who may be nearby. This added layer of movement and context is much more valuable than what's available on existing social networks, such as Facebook, that don't automatically offer location-specific information.

Potential Gold Mine for Marketers There's no denying LBS could also become a gold mine for marketers. "Context awareness is critical when you want to buy something, and advertisers get higher targeting based on our patterns and social contexts," says Massachusetts Institute of Technology researcher Nadav Aharony.

Yet as the space crowds with LBS players, the challenge will be to protect users' privacy, find ways to make marketing pitches relevant, and separate useful sites from also-rans.

Executives at Brightkite take security concerns seriously and give users the option not to broadcast their whereabouts. "A real sense of privacy is important, and we spend a lot of time thinking about it," says Brightkite CEO and co-founder Jonathon Linner. "Privacy has to be transparent—in the setting menu and the post screen. It has to be very explicit." Twitter plans to make its location services opt-in, also letting users choose whether to tell others where they are.

A related but more fundamental question: What happens to the data that are being collected about our whereabouts? Who or what controls it? "We need to be the owners and keepers of our information, and there are many ways to do this from a user standpoint," says MIT's Aharony. "We can create our own groups and set our security settings and circles of trust, and how we do this is critical."

At the MIT Media Lab, Aharony is developing an open-source LBS platform that lets users communicate directly from one computerized device to another, such as through Bluetooth technology, without having to go over a wireless network or be logged on to the Internet. "The majority of [existing] apps are very centralized—they remain Internet-based, and the controls are with the company," he says.

Ad Intrusion: Treading a Fine Line Marketers that hope to capitalize on a person's whereabouts will need to learn how to send relevant pitches without going overboard or becoming a nuisance. "This has great benefits if it gives us what we need when we want it, but keep in mind that commercial interests are seldom in harmony with our personal interests," says UCLA Internet researcher Brad Fidler.

To be relevant, marketers will need to know a person's tastes and interests as well as location, experts say. "Location is not everything," says Linner. "If you're hanging out near Times Square, it doesn't mean you want to eat there. But if we know that you like Spanish food, then we could suggest a place that's on your route. The real value lies in providing better suggestions." Some consumers will need incentives, such as free or subsidized phones or calling plans, in exchange for the intrusion of ads and other marketing messages.

When it comes to existing sites, I find Brightkite and Aka Aki the most user-friendly for both beginners and savvy socialites. I found it quite easy to integrate them with my existing mobile devices, and it helped that some of my friends were already using the services.

Another factor was connectivity on the go. For example, Aka Aki's mobile version incorporates a combination of Bluetooth, GPS, and Wi-Fi technology to find users within specific areas and alert you via text if someone you know is nearby. Brightkite has also made it convenient to stay in touch on the go via text and e-mail, and I especially love the way I can send location-tagged pictures from my LG mobile phone. It's the feature I use the most since I love taking pictures. Brightkite also automatically sends my pics to Twitter.

Brightkite and Aka Aki also win because they look like finished products, and they pay attention to design details. Loopt, Pelago (Whrrl), and regional players such as Moximity are too gimmicky for my taste. Whichever services prevail, they're very likely coming to a phone or computer near you before long, and chances are they will radically change the way you communicate and how friends and marketers alike stay in touch with you.